Good morning, everyone. Thanks for staying with us here. I'm Mike Cyprys, equity analyst covering brokers, asset managers, and exchanges for Morgan Stanley Research. It's my pleasure to welcome Tal Cohen, President of Nasdaq, leading their market services and financial technology divisions. Tal, thanks for joining us. Yeah, thanks for joining us. I'm blaming the sparse crowd on the Knicks game last night. Some people, they were sad they couldn't make it. Well, they're coming in here now. The door's open there. As many of you know, Nasdaq to be a global exchange operator, but in recent years, Nasdaq has been transforming the business through a series of acquisitions to become a technology and platform provider to serve corporates, investment managers, and financial institutions as they navigate and interact with the global capital markets and the broader financial system. We're thrilled to have Tal with us here to discuss the transformation. I thought we'd start off talking on the markets division here, and the broader market backdrop, which we've seen a strong start to the year across here, and the industry's cash equities options helped by volatility, retail engagement growth, and short-dated options, which we'll dive into in the coming questions. Can you talk about how Nasdaq is seeing what you're seeing so far in terms of April, May, early June? Talk about the activity you're seeing. How much of this feels, would you say, cyclical versus more structural, and how you're thinking about volume growth capture and market share from here? Yeah. Again, thanks for having me. Coming off the back of a strong Q1 where our markets business grew 10%, and that was off a record year before that. We're seeing a number of macro structural trends that we're talking about. One is, if you look through April and May, strong corporate earnings. Secondly is strong retail engagement. You continue to have a constructive regulatory backdrop, which is very helpful from both the SEC and the CFTC. Obviously, AI and the AI trade continues to be a strong tailwind for us. Those are kind of the macro themes that are playing its way through the market in Q2, and for the most part, in Q1. In terms of our markets themselves, I love the competitive positioning of our markets. We have in the U.S. equities side, our capture is 70% higher than the number two player in the market, and that's in part because of the technology we provide, the services we've provided, the innovation that we've brought into the market over the last four or five years. Really proud of where we stand there, Nasdaq is the single largest equities exchange, and it's probably the largest equities exchange by about 500 basis points. We're doing really well in equities, like our competitive position despite the competition there. On the options side, we're also the number one player in multi-listed by about 500 basis points over number two. Our index options business has grown over 60% year-over-year. Really, really healthy. Again, both of those businesses are positioned for growth, competitive positioning is strong. We continue to invest in these businesses. On the options side, we are migrating to our, what we call Fusion, our new global derivatives trading platform. Our sixth medallion is going to be migrated to that platform, and then we'll be complete. We will have upgraded our entire technology stack on the options side by the end of the summer. Really excited about that. We just continue to invest in our technology, in our servicing. Of course, AI will play a role in the way that we do servicing going forward. Generally speaking, really happy about our performance and what the outlook is. Is Fusion the options technology that's in the cloud? Is that something separate? Great question. We announced back in 2021, we took our first medallion, which is MRX, our mercury market, to the cloud, and that was with AWS on Outpost in our own data center. What we were able to do is prove resiliency and performance in taking our market to the cloud. We did that with Fusion. It was on our new global trading derivatives platform in the cloud. That was really monumental for us because that also allowed our financial technology clients. We serve 130 exchanges and regulators in the world. That's the blueprint for them. Great. Nasdaq recently received approval to move to 23/5 trading. Let's talk about that. With the go-live date expected for December 6. Where are you seeing the strongest demand? What still needs to be solved as you prepare to go live here? How should investors think about the economic impact across your platform from this potentially? Yeah. It's a two-part question. Let me take the first half, which is how do we see the economic opportunity, then I'll talk about the challenges. 23/5 is just part of a greater thematic, which is always now or always on. On always on, the way that we think about it is, it's not just 23/5. There's tokenization, there's accelerated settlement, there's faster movement of money and securities. As a result of that, we see an opportunity across the entire platform. From our data franchise, an opportunity for our data franchise to really embrace 23/5. From a financial technology perspective, we are looking at our trading business, our post-trade business, our surveillance business, and our Calypso business all have opportunities. Obviously we provide trading and post-trade technology. Think about surveillance in a 24/7 or a 23/5 world, a real great opportunity for us. For Calypso, it's collateral management. Collateral management, probably one of the biggest opportunities that comes off of the back of always on and 23/5. Then the third part of it, of course, is just our trading business. Right now, we see about 10% or 11% of average daily volumes occur after the close or before the open. About two percent of that is overnight. Most of that is retail. We expect that to grow over time. Across the entire platform, from data to financial technology to our trading division, we just see opportunity in the short term, medium term, and long term. In terms of the challenges, and we've spoken a lot about this, and we address them through the way that we're implementing here, is they cut across three themes. One is infrastructure. We need to make sure that all of the infrastructure in U.S. equities, in particular, is ready, and U.S. options for that matter. That's the securities information processor, it's DTCC, OCC, and it's, of course, the trade reporting facility. All of that infrastructure needs to be put in place. The second one is operations. We want to make sure that we're handling corporate actions. We are putting volatility guards that manage volatility and movements overnight where liquidity could be thinner, price discovery is harder to come by. We're thinking very closely about not just corporate actions, but how we manage operational excellence and resilience in the overnight section. The last one is just technology. How we apply our technology in a 23/5 world. How do you upgrade your technology? Over time, you're not going to have the weekends. You have truncated or shortened periods of time to address any incidents or issues in the market. How are you handling that from an exchange perspective? We've thought a lot about all three dimensions, and we feel really good about what we're coming out with on December 6th. I think it's going to improve transparency, the integrity of the markets, and there's an opportunity to really unlock greater demand in the markets. Great. Why don't we shift and talk about options, where activity remains quite elevated across the industry, particularly around some of the short-dated and zero DTE exposure. What's your take on the sustainability of growth in the options market? What are some of the risks that the industry needs to manage, particularly as you think about zero DTEs? What needs to happen before you could see this broadening out beyond, the eight stocks today and the Monday, Wednesday to eventually Tuesday, Thursday. How do you see that? What sort of risk might there be to this sort of growth if from the CFTC ruling on perps? To what extent does that open the door for other assets for retail to trade and potentially impact demand for cash equities, options, zero DTEs? Yeah, that's a three-parter. Let me take the first part, which is, you're referring to single stock. Single stock, we did the Mag Seven, Broadcom, and IBIT. Yep. Those are the nine names we went out with. We had a methodology that was objective, we actually had a consultation with the industry around that methodology, it had three components to it. It was liquidity, market cap, and the float. We looked at across those three dimensions. That's how we came up with these nine names. As you said, we came out with Monday, Wednesday to start. What we did is we looked at market quality, we looked at liquidity, and we wanted to make sure that both were healthy. What we've seen so far, it's still early days, by the way, but what we've seen so far is market quality is strong. Deep, liquid markets, no impact there. If anything, it's neutral to positive. On liquidity, it's additive. We've seen an uptick about 15%-20%. Market share has been very strong for us, across that, if you will, grow the pie story. As we think about expanding it, because you asked me about expansion, we think the opportunity is Tuesday, Thursdays. Of course, we'll work with the SEC on that and the industry. We can figure out what names as we go downstream in the options market are applicable and what characteristics really lend themselves to short-dated options. Short-dated options, for what it's worth, has become a real, if you will, real important hedging vehicle, income vehicle, market sentiment vehicle for both institutions and retail. In terms of just the challenges, which is part two of your question, of course, we're going to work with OCC and the industry. Those are the two biggest. One is OCC from a risk management perspective, how are you modeling it? Do you understand what we're looking at throughout the trading day? Do we have the right and appropriate margin collateral requirements for that? On the industry side, it's education. Do you understand how to use these products? They're not like inverse and levered ETFs, let's not mistake it for inverse or levered ETFs or products like that, where they carry some inherent risk and some other educational components to them. What we do with the industry is much more about the use cases and the utility of short-dated options. Your third part of your question was CFTC and, yeah, perps. The beauty of perps for those that are using them, it's obviously in crypto, it served a purpose, is it's simple, it's 24/7, there's a ton of leverage. It's where price discovery happens in crypto. If you just look at options, for example, you think about what we're doing in the options world and NDX in particular, or for short-dated options, well, the options markets are really incredibly vibrant. There's great liquidity, great market quality there. We spent a lot of time nurturing and cultivating this ecosystem of institutional and retail players. That has taken us 10, 15 years to cultivate that kind of community, that kind of liquidity, that kind of market quality, one. Two is the utility of options is much greater than what it is in perps. Perps. I looked at perps. I'm on a platform, again, for crypto, it's super simple, you got to understand, like, the funding rate, how that works, it's very linear in the way that it provides exposure. Versus where options, again, you have hedging, risk management, income yield, then of course, expressing sentiment. Really, if you even think about short-dated options, most of that usage is around trying to understand events that are going to happen in the short term versus perpetuals thinking about kind of long-term linear views of the asset. In many ways, I think they complement one another. Perps feel much more like levered-ETFs and maybe even swaps and CFDs than they do options. Again, the CFTC and the SEC hasn't even ruled on whether if it's a future or a swap. That's a really important distinction. Jamie Selway spoke just last week and said, "Hey, legally, we haven't determined what these are in the U.S.," which is really, really interesting. Again, I think what we've done in options, incredibly strong franchise, great diverse use cases, the liquidity and price discovery function is really robust, it's more complementary than it is competitive right now, we'll take a look at it. If anything, it provides us with an opportunity to do more. One thing we announced, I should have mentioned it at the beginning, we're going to do binary options, which have an element of perps to it. It's going to be, if you will, or event and predictions. We'll have that, if you will, binary zero one type of outcome to it. We'll do it on financial and economic products. As we see the regulators embrace innovation and allow us to do more, of course, we're going to do more and take advantage of it. Like I said earlier, we're already moving to 23/5. What does that, I guess, roadmap look like on the binary option side in terms of the product timeframe? What would you say there? We're engaging the SEC right now. We're looking at year-end to launch that. We'll start with the Nasdaq-100 complex. We'll start with up/down type of contracts. Again, the advantage we have is we don't have a cold start. We're going to do it on one of our medallions. It's well-regulated. It's centrally cleared. There's the entire risk management function behind it. We're really starting with an incredibly strong foundation when we launch these products. Then we'll put marketing and sales efforts against that, a go-to-market effort against that. Then we'll partner with some retail distribution, which we already have very strong relationships with across the retail community. I'm really excited about what that looks like. Of course, it's going to be a crawl, walk, run scenario because we're going to have to educate retail. We're going to have to make sure that we're educating not only retail, but the regulators on what we see. We want to be responsible whenever we introduce innovation and new products like this into the market. Well, speaking of innovation, let's talk about tokenization, which can be helpful in supporting always-on markets. Nasdaq has been active here and has talked about putting issuers at the center of a tokenized equity design. How do you see tokenization fitting into Nasdaq's broader market structure strategy over the next three - five years, and where is Nasdaq, would you say, most advantaged? Most advantaged. Okay. There's five dimensions that I think play very well for us when it comes to tokenization always now. One, we have incredibly deep relationships with our issuers and investors because of the platform that we have. We're able to, if you will, be the nexus between issuers and investors, bring deeper engagement, deeper understanding between those two communities. Our issuers trust us. We have deep relationships with them, and we touch investors in so many ways. That's our second advantage, where because we provide financial technology solutions to investors, we are serving them in so many different ways outside of just our markets. We have relationships with private companies, public companies all over the globe. The third is the unique partnerships we've been able to put in place. We announced one with Kraken. It was non-exclusive. We're in discussions with others. We've done something with Börse Stuttgart in Europe. We've put together these really unique partnerships that complement what we do and the two strengths I just mentioned before. The next is we've taken a leadership position. We were first to have the SEC approve our tokenization filing. We were the first to come out with a token that considered issuer needs. That, again, allowed us to have a voice with government regulators and our issuers, which was incredibly unique when we came out with the Nasdaq equity token. We talked about incorporating important characteristics for issuers inside the token. This is incredibly important, when you talk about tokenization or always on or 23/5, you need to be global. You need to service your clients globally. Our financial technology franchise, where we serve 130 exchanges and regulators, we're providing trading, post-trade technology, surveillance technology, Calypso, then of course, our markets. You layer all of that, we are touching all of our clients in different ways across the globe, and we are really thinking about ourselves as like the trusted fabric as we think about this always-on opportunity throughout the platform. Really powerful when we talk to customers about that. How should investors think about the economic opportunity for Nasdaq from tokenization? Do you see this becoming a direct new revenue opportunity through new services, new technology that you're charging revenue, charging fees, or is the bigger opportunity really about extending the core franchise as market structure evolves? We've already announced 23/5. For Calypso, we've talked about supporting tokenization, tokenized treasuries, stablecoins. That is really interesting because Calypso's, one of its strongest modules is collateral management. In the world that we live in, collateral management has become so important. For us to build on that strength by offering tokenized assets off the back of that really positions us incredibly well with Calypso. Those are just a few short-term opportunities. Again, I talked about data, even in the index franchise, we see opportunities there. Longer term, what we said in Investor Day is we see a $3 billion-$6 billion market opportunity, and we stand by that. We're seeing some momentum across the board on the things I've just spoken about, whether it's accelerated settlement, freeing up capital. The thing about tokenization, by the way, is it's taking a static asset and it's putting that asset in motion. Once you put that asset in motion, that's when Nasdaq really shines, because again, whether it's surveillance, allowing you to see where that asset is, how it's playing out in the market, Calypso, even Verafin on the payment rails, if you think about real time, and it's going over digital rails longer term, and then of course, as it comes through our market. I think shorter term, there's a series of opportunities. Longer term, we've talked about $3 billion-$6 billion, and that excites us because of the position we have across the board. Let's shift gears and talk about the financial technology divisions. It's become an increasingly important part of the Nasdaq story. You've seen strong growth across AxiomSL, Calypso, Verafin, surveillance, or even the broader capital markets technology business. What would you say are the biggest drivers of durable growth today, and what would cause the fintech growth profile to move toward the higher end of your 10%-14% medium-term range? Let's start with Q1. We were able to share with investors a great Q1 where we grew 18%. We were really proud of that, and that was because the strong pipeline we've generated, a strong client engagement, and continued desire to see Nasdaq as a trusted partner. If I take it from the top, what's really unique about our financial technology divisions is across capital markets tech, regulatory technology, and financial crime, all of those solutions are category leaders in one way or another, which is really unique because we don't have one particular solution that stands out. All of our solutions in each of our categories are really standouts, and we're really proud of the performance each one of them has. The other thing is each one of those solutions are mission-critical. When we talk about the environment we're in, we are having conversations with our clients around how to run the bank and how to transform the bank. Our solutions serve both sides of the equation. If you're thinking about what it means to run your bank or run an institution over the next five years, we're a trusted partner. If you're thinking about transformation over the next five years, we have mission-critical solutions for you. The four themes that come up in every conversation I have, and I have the privilege of going across the globe talking to tier 1s, FMIs, all the way down to community banks, and there's four themes that stick out. One is modernization transformation, and it means different things to different folks, whether it's cloud, AI, or simply automation. The second is complexity. The world we live in, where you have geo-economic divergence, geopolitical divergence, regulatory divergence. Reducing that complexity through automations and the tools that we provide and the solutions we provide is very important. The third is the pace and intensity of regulatory change. Look at Basel III endgame. There is a proposal out there. It looks like it's going to go through. It actually presents a really interesting opportunity for Axiom now. That is the pace and intensity of change around regulation is a big opportunity. The last one is the integration and adoption or adoption integration of AI and cloud. Being a market operator, what makes us unique, we have credibility the second we step into a client's premises because we're sharing our own blueprint, what we're doing with our own markets, how we consume the technology we're selling. That allows us to really go in and, with empathy and understanding, talk about what it means to integrate and adopt these technologies. It's been great. The growth algorithm, and we shared this on Investor Day. Our growth algorithm is obviously. We have a number of vectors here. New logos are about 20% of it. The other 80% cuts across the land and expand strategy we have, which is our upsell motion and our cross-sell motion. On our cross-sell motion, we talked about on Investor Day, having 43 cross-sells, a run rate of $45 million. We are very confident that we can continue to meet our $100 million revenue runway goal by the end of 2027. We have a number of different ways that we can grow across, if you will, the spectrum. Great. Maybe diving into AxiomSL and Calypso. Last year, there was a lot of discussion around integration, cloud migration, the elongated sales cycles. Where would you say we are today in that journey? What would you say is changing today in the client decision-making process, and how much of the opportunity ahead is about replacing legacy infrastructure versus expanding into new workflows that one-term Nasdaq embeds? We're going to come up on the three-year mark of our acquisition of Adenza on November 1st. We actually announced it, I think, on June 12th. It's just about three years from when we announced it, and we're proud of the way we've integrated those assets to become an important part of the Nasdaq family, foundational to our financial technology division. Our clients have really embraced Nasdaq owning these assets. We have a right to own these assets. Our investment thesis when we bought them was that we can simply accelerate and amplify the strategy and the growth of these assets. We've been able to do that, whether it's been by modernizing these assets and thinking about their cloud strategy, their AI strategy of these assets, opening up doors with clients they had not yet met because of the brand halo that we have. In terms of growth, it's really interesting. We have a tremendous opportunity as you look across the globe, in particular with Calypso, to go in where there aren't any solutions, where they're still using Excel spreadsheets or thinking about how to transform manual processes into automated processes across the globe so we can convert operational spend into technology spend. That's a great opportunity for us on the Calypso side. On the AxiomSL side, there's two things to highlight there. One is we have a down-market opportunity or a mid-market opportunity. It's an incredible platform. It's truly one-on-one in terms of how global and comprehensive it is. It's in 66 countries. We have a library of over 6,000 reports. We serve most of the tier 1s. Now being able to package that solution, go downstream, has been really interesting. When we do that, we start to run into Verafin clients. That's really interesting if you think about the cross-sell opportunity there. The final one with AxiomSL is AI and cloud. AxiomSL is built on modern rails, has a great data management platform, and our ability to think about how AI really powers AxiomSL for the next generation. We started to build out a suite of agents or agentic capabilities end-to-end, from everything from data discovery to any question you might ask to identify correlation analysis to anomalies in your reporting and having a master agent empowering you so your workflow is streamlined, is incredibly interesting and attractive for our clients. In some cases, it's what's propelling our clients from thinking about, let me go from on-prem to cloud because you have AI capabilities, and by the way, you have managed service capabilities. AI just on its own is compelling, but when you think about some of our on-prem clients that we're moving, because you asked that question, it really does, if you will, accelerate our cloud and managed services strategy as well. Why don't we shift and talk about Verafin, which continues to be one of the fastest-growing parts of the Nasdaq portfolio. Can you update us on the opportunity across tier 1 and tier 2 banks? Where are you in the enterprise pipeline here? How the product changes as you move into larger and more complex institutions? Definitely. My voice is getting a little bit, because I was yelling last night at the TV. Verafin, we continue to view it as a mid-20s grower. Again, it's really truly a one-on-one, and since the acquisition, we've been able to sign 22 enterprise clients. In 2025, we signed nine. It's accelerating. We also announced a cross-sell deal with the tier 1 after Q1 of this year. We're really proud of the way that Verafin has been able to grow and expand its footprint. Of course, we have the international expansion efforts. I talked a little bit about cross-sell and how it fits really nicely now with AxiomSL and Surveillance in terms of customer personas and the go-to-market motion that we have across all of our financial technology products. I think we continue to see Verafin's prospects in terms of who it serves and why it serves them as a growing opportunity. If I go back to always on and you think about real-time payments and increasing fraud and the importance of addressing fraud and what a drain it is on the economy, not just here, but across the globe, this is interesting. Every conversation, I go into a client, and I talk about all our financial technology solutions, and I spend five minutes, and I walk through with a prospect or a new client. They'll always stop me on Verafin and say, "Could you just talk about that again? How does that work?" I talk about our consortium data lake. I talk about the fact that we have 2,800 clients, 700 million accounts, and how we do it, and how it's cloud-native, and in fact, AI-native. Really the opportunity for Verafin continues to be large and global and one that we're really focused on in terms of growing upstream and then taking them into new markets. Given Verafin's cloud-native architecture plus the consortium data set that it has, how are you embedding agentic AI into the workflow? What have you learned so far from some of the early usage and adoption that you're seeing, and what are some of the biggest client benefits? Good question. We have two agents that are live now on Verafin, and we spoke about this on Investor Day. We have the sanctions agent and an enhanced due diligence agent. We're seeing incredible productivity gains that our clients are capturing value. We actually, when we go to clients, we show them the ROI calculator. We have an ROI calculator for clients, which is incredibly compelling and tangible in terms of what we're providing clients in terms of value. It allows us to capture some of that value and share in that value creation. Off the back of that, there are six more agents that we have on our product roadmaps. There's a robust product roadmap. Our agents are being well-received. Since Investor Day, we now have 500 clients on it, which would be a 40% increase just since Investor Day. We're seeing real traction, uptick in our agentic workforce. We're seeing real productivity gains, real value that we're able to capture for our clients. Over the long run, I think there's a tremendous amount of value we'll be able to capture off that as well. AI touches many parts of the Nasdaq organization. Talk about where AI is driving some of the most tangible benefits so far and what you're seeing in terms of client demand, cost efficiency. How do you think about creating new products or even revenue streams over time with AI? I'll pick a couple. We think about AI as on the business and in the product. On the business is focused on engineering and what we call client experience, which would otherwise be thought about as client success, professional services, and client support. Just on the business for a second, we are seeing productivity gains across the entire product development life cycle. We have developed agents and a master agent, so a series of agents, for example, for our surveillance solution, where everything from business requirements to turning that into technical to QA, to the examining the results of QA, and then that full life cycle of working through any exceptions. We're starting to build all that out. We have four agents in the surveillance PDLC. We'll have 12 when we're done with it. That just shows you the kind of productivity gains we can have across surveillance. What will that do is it's not just productivity. Very importantly, it allows us to drain our backfill faster, which means we can deliver to clients faster, and it improves the quality of the software we're able to deliver. Really, really important. On the client success side or client experience side, we are deflecting tickets. We're putting agents in place that allow us to address client questions, level 1, level two, level three type of questions that we'll get from clients. There's always a human in the loop or on the loop monitoring this. Over time, we think there's an ability to truncate the period of time between a client question and our ability to address that, and then obviously to scale that capability as we think about our platforms and as we think about our growth profile. In the product, just a few examples. One is surveillance. We launched Calibration Copilot. When you set up alerts, it's a little bit of a trial and error when you set up your alerts. We now set up an agent that allows you to calibrate your alert, so it's not a trial and error. There's a, if you will, collective intelligence component to it and a compounding intelligence component to it because we're taking information from all of our surveillance clients to inform this agent, which reduces the amount of time to calibrate your alerts. There's two things that come out of it. One is you have less false positives. Two is you're more accurate in identifying areas of market abuse. Why is that important? Because when you're calibrating these alerts, your regulators may knock on your door and say, "Hey, you have all these alerts. Why do you have all these alerts?" Then you need to hire staff to look into all of these alerts. If it's a 90% false positive rate, that's a tremendous amount of overhead on a bank, and your bank and every other bank would experience that. Then you think about that in the context of 23/5 markets. Think about that in the context of perpetual futures. Think about that in the context of prediction markets. This is just like an overflow of, how do I manage all of this? I need a surveillance solution, a market abuse solution that is powered through AI. We're really, really excited about that. Maybe the only other one is, and I kind of talked about it before, what we're doing with AxiomSL. Really proud of that. I think, again, that's a full suite of agents, end-to-end workflow, managing that workflow for clients. On Calypso, just because I haven't mentioned that, one particular agent we've launched that has been very popular with our clients is SettleGuard. It's a settlement failure predictor agent. We'll take data, public data, and some unique data, and allow our clients to understand the potential for settlement failures in bilateral transactions and get ahead of that. Think about how important that is in a world where you're trying to manage collateral, where settlement failure is a real cost to the business, being able to get in front of that, especially in the OTC bilateral world, is of value to our clients. Great. Well, I'm afraid with that, we're out of time. Please join me in thanking Tal Cohen. Thank you. Thank you. Appreciate you having me. Thank you. Good to see you. Yeah. Bye.